Head to Head Analysis: Ashford Hospitality Trust (AHT) & LaSalle Hotel Properties (LHO)

Ashford Hospitality Trust (NYSE: AHT) and LaSalle Hotel Properties (NYSE:LHO) are both finance companies, but which is the better investment? We will contrast the two companies based on the strength of their earnings, dividends, risk, valuation, profitability, analyst recommendations and institutional ownership.

Analyst Recommendations

This is a summary of current ratings and target prices for Ashford Hospitality Trust and LaSalle Hotel Properties, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Ashford Hospitality Trust 0 3 3 0 2.50
LaSalle Hotel Properties 2 10 1 0 1.92

Ashford Hospitality Trust presently has a consensus target price of $7.46, indicating a potential upside of 15.45%. LaSalle Hotel Properties has a consensus target price of $28.46, indicating a potential downside of 0.60%. Given Ashford Hospitality Trust’s stronger consensus rating and higher probable upside, research analysts clearly believe Ashford Hospitality Trust is more favorable than LaSalle Hotel Properties.

Profitability

This table compares Ashford Hospitality Trust and LaSalle Hotel Properties’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Ashford Hospitality Trust -5.43% -10.41% -1.64%
LaSalle Hotel Properties 27.85% 13.05% 8.48%

Insider & Institutional Ownership

70.3% of Ashford Hospitality Trust shares are held by institutional investors. 18.2% of Ashford Hospitality Trust shares are held by insiders. Comparatively, 0.4% of LaSalle Hotel Properties shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Dividends

Ashford Hospitality Trust pays an annual dividend of $0.48 per share and has a dividend yield of 7.4%. LaSalle Hotel Properties pays an annual dividend of $1.80 per share and has a dividend yield of 6.3%. Ashford Hospitality Trust pays out -35.8% of its earnings in the form of a dividend. LaSalle Hotel Properties pays out 66.9% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Ashford Hospitality Trust has raised its dividend for 5 consecutive years. Ashford Hospitality Trust is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation and Earnings

This table compares Ashford Hospitality Trust and LaSalle Hotel Properties’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Ashford Hospitality Trust $1.45 billion 0.43 $394.52 million ($1.34) -4.82
LaSalle Hotel Properties $1.18 billion 2.75 $371.93 million $2.69 10.64

Ashford Hospitality Trust has higher revenue and earnings than LaSalle Hotel Properties. Ashford Hospitality Trust is trading at a lower price-to-earnings ratio than LaSalle Hotel Properties, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Ashford Hospitality Trust has a beta of 1.47, meaning that its stock price is 47% more volatile than the S&P 500. Comparatively, LaSalle Hotel Properties has a beta of 1.17, meaning that its stock price is 17% more volatile than the S&P 500.

Summary

Ashford Hospitality Trust beats LaSalle Hotel Properties on 11 of the 17 factors compared between the two stocks.

Ashford Hospitality Trust Company Profile

Ashford Hospitality Trust, Inc. is an externally-advised real estate investment trust (REIT). The Company is focused on investing in the hospitality industry with a focus on full-service upscale and upper-upscale hotels in the United States. The Company owns its lodging investments and conducts its business through Ashford Hospitality Limited Partnership (Ashford Trust OP), its operating partnership. The Company’s portfolio consists of 121 properties with over 25000 rooms; 86 hotel condominium units at WorldQuest Resort in Orlando, Florida; a 96.6% ownership in Ashford Quantitative Alternatives (U.S.), LP (the AQUA U.S. Fund); a 29.7% ownership in Ashford Inc., and a 13.3% ownership in OpenKey.

LaSalle Hotel Properties Company Profile

LaSalle Hotel Properties is a self-administered and self-managed real estate investment trust. The Company primarily buys, owns, redevelops and leases upscale and luxury full-service hotels located in convention, resort and urban business markets. As of December 31, 2016, the Company owned interests in 46 hotels with approximately 11,450 guest rooms located in nine states of the United States and the District of Columbia (DC). As of December 31, 2016, the Company’s properties included Hotel Amarano Burbank; Hilton San Diego Gaslamp Quarter; Hotel Solamar; San Diego Paradise Point Resort and Spa; The Hilton San Diego Resort and Spa; Harbor Court Hotel; The Marker San Francisco; Chamberlain West Hollywood; Le Montrose Suite Hotel; The Grafton on Sunset; Hotel George; Hotel Rouge; Mason & Rook Hotel; The Donovan; The Liaison Capitol Hill; The Marker Waterfront Resort; Hotel Chicago; Onyx Hotel; Park Central Hotel New York; The Heathman Hotel; Westin Philadelphia, and Lansdowne Resort.

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